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Johannesburg - South Africa trade unions want President Cyril Ramaphosa to explain the Kigali Protocol he signed last week, signalling the government’s commitment to joining the African Continental Free Trade Area (AfCTFA).
The AfCTFA was signed by 44 countries in Kigali, Rwanda, last week, but the continent’s two largest economies notably didn’t put pen to paper.
Nigeria’s president Muhammadu Buhari skipped the 10th Ordinary Session of African Union (AU) Heads of State summit due to protests by trade unions and local manufacturers and South Africa only attached its name to the Kigali Protocol, signalling commitment to sign the AfCTFA in the future.
Matthew Parks, parliamentary officer of the Congress of South African Trade Unions (Cosatu) said SA unions share Nigerian labour concerns that African states with weak import controls will be used by countries outside of Africa to “dump” cheap imports and destroy local industries.
“We know what happened to the textile industry in the 1990’s (and) the poultry industry,” Parks told Fin24.
He added that there are already problems within the Southern African Customs Union (SACU) - made up of Botswana, Lesotho, Namibia, South Africa and Swaziland - where he claims Chinese companies set up "false warehouses" in Lesotho and bring their products into South Africa.
“It’s fantastic on paper… but a free trade area could destroy the economy overnight and would further de-industrialise the country,” Parks warned.
Dennis George, general secretary of the Federation of Unions of South Africa (Fedusa) warned that an Africa wide free trade agreement could lead to local job losses.
“It could easily become a situation of cheaper labour in countries with no labour standards and undercut the local labour market,” said George.
He added that Africa should look to Europe in the creation of the European Union and learn from the mistakes made there.
“It could turn South Africa into the Germany of Africa, where you have a 4% unemployment rate,” he said.
Parks added that, in order to avoid a flood of migrants into more prosperous countries, there would need to be simultaneous development across the continent.
Only 27 states signed the Free Movement Protocol in Kigali, while 44 inked the AfCTFA. South Africa will consult about both, before agreeing to their terms.
Nedlac discussions
Both Cosatu and Fedusa agree that the National Economic Development and Labour Council (Nedlac) will be the best arena to thrash out details of the AfCTFA.
Representatives of government, business, labour and communities are meeting at Nedlac this week and Fedusa said its officials have been mandated to ask that the African free trade agreement be tabled in the Trade and Industry Chamber.
Patrick Craven, spokesperson for the South African Federation of Trade Union (SAFTU) said the labour movement, which is yet to join Nedlac, will be discussing the issue and deciding on a way forward.
If all 55 AU members sign, The AfCTFA will be the world’s largest free trade area since the World Trade Organisation, which was formed in 1995 and will bring 1.2 billion people together with a combined gross domestic product (GDP) of approximately R24trn.
According to African Development Bank data, intra-African trade made up only 16% of total trade on the continent in 2014.
Ramaphosa said in Kigali last week that he needed more time to “follow constitutional and internal processes” before signing the agreement.
Other countries which also wanted to hold internal discussions first include Botswana, Lesotho, Namibia, Zambia, Burundi, Eritrea, Benin, Sierra Leone and Guinea Bissau.
Another AU summit will be held in Mauritania in July where countries with reservations are expected to sign.
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